Australia's unemployment rate unexpectedly jumped to 5.2 per cent in October as the nation's powerhouse states prepared to emerge from coronavirus restrictions and people started looking for work again.
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The number of people employed fell by 46,300 when economists had expected a 50,000 rise.
The participation rate of people in or seeking employment rose to 64.7 per cent in October compared with 64.5 per cent the previous month.
It was the first increase in the participation rate since June.
The jobless rate was 4.6 per cent in September, after striking a 13-year low of 4.5 per cent in August, but this was more to do with people leaving the workforce rather than indicating a strong labour market.
Employment Minister Stuart Robert said the figures continued to reflect the negative impact the COVID-19 pandemic and related lockdowns had on labour market activity.
"That said, the Australian labour market is set for a strong recovery, with payroll jobs already rebounding and job advertisements surging to a 13-year high," he said in a statement.
The increase in unemployment showed that people were preparing to get back to work, Australian Bureau of Statistics head of labour statistics Bjorn Jarvis said.
"And increasingly available and actively looking for work - particularly in NSW, Victoria and the ACT," he said.
"This follows what we have seen towards the end of other major lockdowns, including the one in Victoria late last year."
ANZ senior economist Catherine Birch said the unemployment rate could be a bit bumpy in the coming months, depending on the relative pace of the recoveries in employment and participation.
"But we expect to see a solid fall in unemployment to around four per cent by end-2022," she said.
Earlier, Treasurer Josh Frydenberg attended a virtual meeting of the finance ministers from the Five Eyes intelligence alliance - Australia, Canada, New Zealand, the UK and the US - hosted by US Treasury Secretary Janet Yellen.
"Today's meeting was an important opportunity to swap notes on how our nations are responding to COVID-19 and to secure our recovery from the greatest economic shock since the Great Depression," Mr Frydenberg said.
"Importantly, I was able to share how our economy is coming back strongly from the most recent Delta-induced lockdowns with business and consumer confidence up and the unemployment rate remaining low."
Australian Associated Press
